The way to the settlement of debts to local authorities in up to 60 installments and with favorable arrangements for vulnerable citizens, after the passage of the relevant bill of the Ministry of the Interior and the publication of the law in GAZETTE

The regulation concerns all kinds of debts of natural and legal persons to the municipalities and their legal entities (such as the Municipal Water Supply and Sewerage Enterprises – DEWA), as well as to the regions.

The benefits of the arrangement are clear for both sides, as on the one hand the citizens who will take advantage of it will have tax awareness, on the other hand the OTAs will improve their finances, as part of the 3.6 billion euros will enter their coffers which has reached the amount of debts to the Municipalities and DEYA.

The settlement concerns debts confirmed until October 31, 2024, while the debtor’s application for inclusion in the settlement is submitted to the competent department of the municipality, region or legal entity until January 31, 2025.

For those who have issued a certificate of vulnerable debtor (annual individual income up to 9,600 euros, other property and other criteria also apply), debts are paid with exemption from surcharges, interest and fines as follows:

a) if they are paid in one lump sum, with a 95% exemption,

b) if paid in two to six installments, with an 85% exemption,

c) if paid in seven to twelve installments, with an 80% exemption,

d) if paid in 13 to 60 installments, with a 75% exemption.

Possibility of repayment in up to 60 installments companies, as well as natural persons who do not belong to the category of vulnerable debtor, have the difference, with the difference that in this case the exemptions do not apply.

For all cases the installments are monthly and equal (except for the last one) and cannot be less than 50 euros.

The arrangement may also include debts that, on the date of submission of the application:

a) are suspended, administratively or by law,

b) have been subject to a previous arrangement or installment payment facility, which is in force, with the loss of the benefits of the previous arrangement and without their inclusion entailing the return of amounts paid,

c) they have not been confirmed, because they are pending legal challenge to any degree, if, in the latter case, the debtor waives the legal remedies or means exercised.

The payment, either of the lump sum or the first installment, is made within three working days from the day the debtor becomes aware of his inclusion in the arrangement, otherwise the arrangement is canceled automatically. Subsequent installments are paid by the last working day ofth of the corresponding month, without requiring special notification of the debtor.

If installment payment is delayed, the debtor is charged with a monthly surcharge of 5% on the amount of the installment, from the day after the day it was due.

During the settlement, as long as the debtor has paid 5% of his regulated debt, for a debt up to 5,000 euros, or 10% of his regulated debt, for a debt over 5,000, an order to lift this commitment is given to the competent DOU and in an order for re-commitment in case of late payment of even one of the installments. Under the same conditions, the taking of coercive measures and the process of coercive execution on the debtor’s movable or immovable property are suspended, but if he loses the benefit of the arrangement, the suspended measures continue.

In case of non-payment of two consecutive installments or a total of three installments, the arrangement is interrupted and the dues are confirmed again, together with the fines and surcharges that have been written off.

The Central Union of Municipalities of Greece (KEDE) requests that the settlement of municipal debts to the OTAs be with a 100% exemption from surcharges for all, without income criteria, as was the case in previous regulations.

The Union of Municipal Water Supply and Sewerage Enterprises proposes to institutionally give the possibility to all DEYAs to entrust the collection of confirmed overdue debts to the DOUs and at the same time, to increase the limitation period from five years to twenty years.

The new law also establishes the possibility of resorting to out-of-court settlement for debts to municipalities and their legal entities that exceed 10,000 euros.

In this case, the debt as a set of claims (initial amount owed, any fines and surcharges), is certified to the relevant DOU, which now manages it as a debt of the State, acting all the operations defined in the regulations of the relevant law 4738/ 2020.